The Philippines is set to buy two Maestrale-class frigates from Italy, a defence official said Wednesday, as the Asian nation races to upgrade its military amid mounting territorial disputes with China.

The frigates, along with 12 FA-50 fighter aircraft, are the most significant items on the government's 75-billion-peso ($1.7-billion) military modernisation budget over the next five years, Defence Undersecretary Fernando Manalo said.

"We are modernising not because we want to go to war with China," he told a news conference.

He said the government had a sworn obligation to defend the "West Philippine Sea," using the government's preferred term for Philippine-claimed areas in the South China Sea.

"We are not saying that this is part of our preparations to assert our sovereignty in the West Philippine Sea. What we are saying is that we cannot just give them up."

The frigates would add to two refurbished Hamilton-class cutters formerly used by the US Coast Guard that the Philippines acquired from its US ally to upgrade its ageing navy fleet, which includes some vessels that first saw action in World War II.

Manalo said the navy had already decided to acquire two new Maestrale-class frigates instead of buying used ones from the Italian navy, and had budgeted 18 billion pesos for them.

The Philippines could be ready to tender by the end of the year, he added.

Meanwhile, the government had alloted 18.9 billion pesos to acquire the fighter aircraft, which are built by South Korea, he added.

The modernisation budget also provides for building or improving facilities to berth and provide maintenance to the vessels on the military's shopping list, Manalo said.

President Benigno Aquino vowed Monday to rebuild the air force by 2016.

The Philippines, which has one of the weakest military forces in the region, retired the last of its US-designed F-5 fighters in 2005.